Cultural, social nonprofits offer lower pay
From The Oak Ridger
January 14, 2008
John Huotari
john.huotari@oakridger.com
EDITOR'S NOTE: This is the second of a three-part salary series focusing on directors of local nonprofit organizations. In Part Two, The Oak Ridger looks at the compensation paid to the leaders of nine cultural and social service organizations.
The leaders of local cultural and social services organizations often bring home much smaller paychecks than their colleagues in economic development.
Generally speaking, in fact, the cultural and social services chiefs make less than half as much money.
Sometimes they don't even receive what might be considered a livable wage.
"Obviously, I don't pay much attention to it," said Nancy England, executive director of Music Arts Inc. "If I did, I'd probably get sick to my stomach."
England collected $9,000 in compensation in calendar year 2007 for what she said is "essentially a full-time job." Although her pay has been higher, England received the lowest pay among the nonprofit organizations whose recent tax information The Oak Ridger reviewed last week.
Meanwhile, the highest pay went to Steven Seifried, former executive director of the Housing Development Corporation of the Clinch Valley. He received $71,300 in compensation in calendar year 2006.
Seifried said nonprofit salary discussions can be "very touchy."
Private organizations tend to pay better because they generate wealth for their owners, he said. In contrast, nonprofits can generate community wealth.
Organizations like HDC that are involved in mortgage lending and home construction might be able to do a little of both, said Seifried, who is now the fund manager in Oak Ridge for Southeast Community Capital.
Despite the sometimes lower pay, there are many reasons people choose to work for nonprofit organizations, including a passion for their duties, Seifried said.
"I never really felt like making money was what it was all about," he said.
Here's a look at what other executives besides Seifried and England were recently paid:
- Rick Morrow, executive director of the United Way of Anderson County. He received $58,827 in compensation in the tax year ending March 31, 2007.
- Lawrence Hahn, executive director of the Boys Club of Oak Ridge Inc. He took home $55,276 in calendar year 2006.
- Susan Burgess-Parrish, executive director of Habitat for Humanity of Anderson County. She collected a $40,000 salary in the tax year ending June 30, 2007.
- Liz Herbes, program director of social services at Aid to Distressed Families of Appalachian Counties. She brought home $39,245 in compensation in calendar year 2006. That was close to the reported compensation for a second ADFAC program director who is now on medical leave.
- Cornelia Kodkani-Laemmli, music director and conductor of The Oak Ridge Civic Music Association. She made $37,080 in the tax year ending June 30, 2007.
- Carol Mullane, executive director of Girls Incorporated of Oak Ridge. She brought in $36,000 in calendar year 2006.
- Mary Ann Damos, executive director of the Children's Museum of Oak Ridge Inc. She was paid a $35,000 salary in calendar year 2006.
Some of the compensation information listed above was taken from tax forms posted online and then confirmed with nonprofit executives. In other cases, the executives or representatives of their organizations provided the information.
Reported compensations might be complicated by additional information, such as whether they include travel allowances or other pay. For example, Damos said she received a travel allowance in addition to her salary, but The Oak Ridger did not include that additional pay in the figure above.
Lower Median Salaries
Although Seifried's pay was high among the cultural and social service organizations, it was low when compared to the compensation received by top local economic development executives.
As reported in The Oak Ridger last Monday, Tom Rogers, Technology 2020 president and chief executive officer, received $252,587 in compensation in calendar year 2006. That was more than three times as much as Seifried's pay.
That individual comparison roughly reflects a more general one, where local cultural and social services chiefs make less than half as much money as economic development leaders.
According to a review by The Oak Ridger, local nonprofit economic development organizations recently offered median pay between about $105,000 and $120,000.
In comparison, the median compensation for cultural and social service organizations was close to $40,000.
That might not come as a surprise to nonprofit leaders and analysts. A 2007 GuideStar Nonprofit Compensation Report said some types of nonprofit organizations offer higher median salaries than others. Health and science organizations offer the highest median salaries, while food, religion and housing organizations pay the lowest, the report said.
Still, a few Oak Ridge residents and some nonprofit leaders said the story on economic develoment compensation was "eye-opening," and they joked that they might be in the wrong business.
'They Feel Called'
The Oak Ridger asked the cultural and social services chiefs why their pay is lower than it might be at some other organizations.
Damos, of the Children's Museum, said some organizations like science and medical groups might get bigger grants and more funding, which makes higher compensations possible.
Arts organizations are always "lower on the totem pole," she said.
Burgess-Parrish, of Habitat for Humanity, said pay is also driven by contributions, so generosity can help nonprofits.
Even with their relatively lower pay, the cultural and social services chiefs said they work hard, help improve lives, and enjoy the challenges of their jobs.
And their staff members can be dedicated, professional and well-educated people committed to assisting others who are less fortunate, Burgess-Parrish said.
"Everyone is here because they feel called to be here," she said.
The cultural and social service leaders also talked about the frugality of their organizations, whether concerning pay or agency spending.
"We try not to exceed our income," said England, of Music Arts. "If we don't take it in, then we don't give it out."
Morrow said 84 cents of every dollar raised by United Way is put back into the community. By one set of nonprofit evaluation standards, the United Way of Anderson County would rate a B+ grade, Morrow said.
Balancing Needs
Several of the leaders said their pay might be low when compared, in salary studies, to other organizations that have the same mission.
"My salary is a bit lower than similar-sized United Ways in the Southeast," Morrow said.
Mullane, of Girls Inc., said her pay is "within the range for an organization my size" but is still a little low compared to other affiliates with similarly sized operating budgets.
At the Children's Museum, Damos said her compensation also is at the lower end of a possible salary range. She said the median base salary for executive directors at children's museums across the country is $59,500.
In response to a question on the subject, executives interviewed for this story said their compensation is set by their boards of directors.
At Aid to Distressed Families of Appalachian Counties, the board tries to weigh the needs of clients and staff members when setting pay, Herbes said.
"I think they do try to balance it," she said.
John Huotari can be contacted at (865) 220-5533.
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